London Foodstore Investment

Co-op | 43 Friern Barnet Road | New Southgate | London | N11 1ND

£1,200,000

subject to contract

EXCHANGED

Summary

  • Highly Secure Income

  • Let to Co-operative Group Food Ltd – Net assets, £1.97 bn

  • Approximately 10.5 years unexpired lease term with 5.5 years term certain

  • Located in a densely populated London suburb

  • Highly prominent position

  • £1,200,000, subject to contact

  • 5.90% net initial yield

co-op-new_southgate-london-property-retail-investment_n11_1nd_-_6166

Location

New Southgate is a suburban North London suburb within the Borough of Barnet, located approximately 8 miles (12.8 km) north of Central London and an important gateway into Enfield, being located next to Barnet and Haringey.

The location benefits from extensive road communications being adjacent to the A406 North Circular Road, approximately 6 miles (6.7 km) east of Junction 2 of the M1 Motorway and approximately 8 miles (12.8 km) south east of Junction 23 of the M25 Motorway.

The area is well served by local transport with New Southgate Railway Station providing direct journeys to Kings Cross in 13 minutes and Arnos Grove Underground Station (Piccadilly line) providing direct journeys to Kings Cross in approximately 22 minutes. The area is also served by a range of bus routes in all directions.

Prospective London rail network plans will make New Southgate the north termination point for the Crossrail 2 line. This will offer even faster journeys to Seven Sisters, Euston and Victoria train stations.

Heathrow Airport is located approximately 21.5 miles (34.6 km) to the south west and Stanstead Airport is approximately 32.5 miles (52.3 km) to the north-east.

Situation

The property occupies a highly prominent position on Friern Barnet Road at its junction with Station Road.

New Southgate railway station is approximately 150 metres to the south of the property and Arnos Grove underground station is approximately 650 metres to the east.

Notable occupiers nearby include Sainsbury’s Local and a BP/M&S petrol filling station.

Friern Barnet Retail Park is located approximately 450 metres from the property. Occupiers include McDonald’s, Subway, Costa Coffee, Sports Direct, B&Q and Pets at Home.

The property also benefits from being in a densely populated residential area. The Place, by Origin Housing, is a new development directly opposite the property on Station Road comprising of 16 one, two and three bedroom apartments.

co-op-new_southgate-london-property-retail-investment_n11_1nd_-_5777
co-op-new_southgate-london-property-retail-investment_n11_1nd_-_101

Description

The property comprises a modern, highly prominent ground floor retail unit. Internally, the unit provides a modern convenience store which has been fitted out by the tenant to their usual corporate style.

The upper floors are sold off and comprise 36 luxury residential apartments which do not form part of the sale.

Accommodation

The property has been measured by BKR Floor Plans and provides the following Gross and Net Internal Areas:

  Sq Ft Sq M
Ground Floor GIA 4,033 374.67
Ground Floor NIA 3,370 313.07

The measured survey report is available to download and will be re-addressed to a purchaser at a cost of £375 + VAT.

co-op-new_southgate-london-property-retail-investment_n11_1nd_-_185
co-op-new_southgate-london-property-retail-investment_n11_1nd_-_108

Planning

The property is not listed and is not located within a conservation area.

Tenure

The property is held by way of a 999 year long leasehold from 21st April 2017 at a peppercorn ground rent.

co-op-new_southgate-london-property-retail-investment_n11_1nd_-_150
co-op-new_southgate-london-property-retail-investment_n11_1nd_-_186

Tenancy

The property is let to Co-Operative Group Food Ltd on a 15 year lease from 10th April 2015, expiring on 9th April 2030 (approximately 10.5 years unexpired lease term). There is a tenant’s break option on 10th April 2025, subject to 6 months’ prior written notice.

The current passing rent is £75,000 per annum (£18.60 per sq ft / £200.18 per sq m). The lease benefits from 5 yearly upward only rent reviews, the next being on 10th April 2020.

The occupational lease is subject to a service charge capped at £2,000 per annum with annual RPI reviews. For the last three years the service charge to the occupational tenant has been below the cap of £2,000. The service charge accounts for the last three years are held in the data room.

Covenant

Co-operative Group Food Limited has reported the following figures:

Year Ending 5th January 2019 6th January 2018
Revenue £7,185,200,000 £6,940,200,000
Pre-Tax Profit £207,900,000 £232,500,000
Net Assets £1,970,500,000 £1,875,100,000

Co-operative Group Food Limited is a subsidiary of the Co-operative Group Ltd, one of the largest retailers in the UK. The Co-operative operate in a range of areas including food, clothing, insurance and funeral services.
Co-operative Group Food Limited are the fifth largest food retailer in the United Kingdom with over 2,800 stores and over 69,000 employees across its local, convenience and medium sized stores.

For the year ending 6th January 2018, Co-operative Group Limited reported a turnover of £9,470,000,000, profit before tax of £72,000,000 and a total net worth of £2,191,000,000.

For further information visit www.coop.co.uk.

co-op-new_southgate-london-property-retail-investment_n11_1nd_-_156
co-op-new_southgate-london-property-retail-investment_n11_1nd_-_160

VAT

The property has been registered for VAT. It is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).

Investment Evidence

Property Sale Date Tenant Term Certain Sale Price NIY
Fulham Road, London Under Offer Sainsbury's 5 years £2,100,000 4.75%
Martin Way, Morden Under Offer Sainsbury's 11 years £1,425,000 5.25%
Hampton Road, Twickenham Feb-19 Co-op 15 years £2,275,000 4.79%
Clapham Road, London Dec-18 Sainsbury's 11 years £2,600,000 3.99%
Coulsdon, Brighton Road Nov-18 Little Waitrose 16 years £5,860,000 4.02%
Adenmore Road, London Sep-18 Sainsbury’s 15 years £2,102,000 4.25%
Colliers Wood, High Street May-18 Co-op 14 years £1,730,000 4.90%
co-op-new_southgate-london-property-retail-investment_n11_1nd_-_153
co-op-new_southgate-london-property-retail-investment_n11_1nd_-_116

Proposal

We are instructed to seek offers in excess of £1,200,000 (One Million, Two Hundred Thousand Pounds), subject to contract and exclusive of VAT, reflecting a net initial yield of 5.90%, assuming purchasers’ costs of 5.93%.

Please note that a purchaser will be re-charged the cost of searches and surveys which are provided in the data room.

Please note a purchaser will be charged a transaction fee of £5,000 + VAT.

Investment Considerations

  1. An opportunity to acquire a modern convenience store investment in a densely populated London suburb;

  2. The property is situated in a highly visible position;

  3. Let to the highly secure covenant of Co-operative Group Food Limited (Pre-Tax Profits £208 million, Net Assets £1.97 billion);

  4. Approximately 10.5 years unexpired lease term;

  5. Attractive lot size to an investor interested in acquiring a London investment;

  6. A purchase at the asking price reflects an attractive net initial yield.

co-op-new_southgate-london-property-retail-investment_n11_1nd_-_155

Data Room and clicktopurchase®

Access to the data room and for the ability to purchase online with speed and ease, please click the clicktopurchase® “C” icon or the clicktopurchase® side bar. Purchasers will be able to access the complete legal package, clear verification and submit legally-binding offers to acquire the property.

Purchasers benefit from the trust, security and transparency provided by the platform. All activities, including the online contract execution, will form part of the electronic audit trail which is anchored in the clicktopurchase® Blockchain.

clicktopurchase® provides the opportunity for any investor, whether located UK or abroad, to uniquely purchase online with ease and certainty. To learn more about clicktopurchase®, click here.

finance

Finance

We have partnered with a leading finance adviser to provide loan services. To learn more, please visit our “Finance” section.

Contact Us

Singer Vielle   +44 (0) 207 935 7200
Daniel Elia daniel@singervielle.co.uk +44 (0) 203 701 1353
Dale Henry dale@singervielle.co.uk +44 (0) 203 701 1356
Neil Singer neil@singervielle.co.uk +44 (0) 203 478 9120

Vendors Solicitor

Axiom Stone Solicitors  +44 (0) 208 951 6989
Jaymini Ghelani JG@axiomstone.co.uk
customer service